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Rain to Strengthen April-Sept Crop


Above average rains in Ivory Coast’s main cocoa regains last week are expected strengthen the development of the April-September mid-crop. West Africa is in its rainy season, which runs from April to mid-November, and up until early this month, most regions were experiencing below-normal rains. Ivory Coast cocoa arrivals totaled 31,000 tonnes for the week ending May 19, down from 41,000 for the same week last year. Total arrivals since the season began on October 1 have reached 1.437 million tonnes, down 29% from last year. Dealers said hoarding of beans by cooperatives may have contributed to the year-on-year decline, possibly cutting this season’s arrivals by 60,000 tonnes. Crop prospects are improving, but there is still the threat of a fourth straight global supply deficit in 2024/25.

cocoa powder and chocolate bits


July NY coffee extended its rally overnight and traded to its highest level since May 2. Dry weather concerns continue in Brazil. Somar Meteorologia reported yesterday that the Minas Gerais region received no rain over the past week, which was the fourth consecutive week of no rainfall. In their annual report on Colombian coffee output, USDA projected that nation’s 2024/25 production at 12.4 million bags, up from 12.2 million in 2023/24. The 2023/24 number was revised up from 11.5 million in the previous forecast. The USDA expects a slow start to Indonesia’s harvest, but they also forecast the nation’s 2024/25 coffee production to come in at 10.9 million bags, which would be a sharp increase from 7.65 million in 2023/24. That was their smallest crop in at least six years. USDA projected Mexico’s 2024/25 coffee production at 3.89 million bags, which would be a slight increase over 2023/24. ICE exchange coffee stocks increased 7,005 bags yesterday, bringing them to a new 14-month high.


July cotton was slightly lower overnight but was still above last Wednesday’s 19-month lows. The weekly Crop Progress report showed US plantings are continuing along at an average pace. The report showed 44% of the US cotton crop was planted as of Sunday, up from 33% the previous week, 42% a year ago and just below the 10-year average of 45%. Texas was 37% planted, up from 28% the previous week and above 34% a year ago and 36% on average. Georgia was 47% planted versus 51% on average, Arkansas 68% vs 71%, and Mississippi 73% versus 62% on average. There was no indication of a slowdown in the Delta or southeast from the rains last week. Heavy rainfall is expected in the northern Delta this week, but other areas look dry. So far, US planting/growing conditions look decent, especially compared to the past couple of years.


July sugar was slightly lower overnight following yesterday’s outside reversal higher. The nearby contract fell below the 50% retracement of the rally from the 2020 low to last November’s high last week, and the move back above that level this week is bullish technical action. There was some supportive supply and demand news as well. A shift towards cooler temperature for Brazil’s Center-South cane growing regions is not expected to bring freezing conditions, but it could have a negative impact on cane yields. The Brazilian 2024/25 harvest is off to a strong start with sugar production in April up 66% from a year ago. Chinese sugar imports this year are running 23% ahead of last year.


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